STMicroelectronics acquires Genesis Microchip

Swiss based STMicroelectronics and Genesis Microchip has announced that they have entered into a definitive agreement for STMicroelectronics to acquire Genesis Microchip.

Under the terms of the agreement, STMicroelectronics will commence a cash tender offer to purchase all of the outstanding shares of Genesis Microchip Inc. for $8.65 per share, net to the holder in cash, implying a
total equity value of approximately $336 million. Following completion of the tender offer, STMicroelectronics will complete a second-step merger in which any remaining common shares of Genesis Microchip Inc. will be
converted into the right to receive the same per share price paid in the tender offer. The offer price represents a premium of 60% to Genesis Microchip's closing share price on Monday, December 10, 2007 and 26% to the
average closing share price during the last sixty trading days prior to this announcement.
During the twelve months ended September 30, 2007, Genesis reported revenues of $191 million. As of September 30, 2007, Genesis Microchip's cash and cash equivalents and short-term investments totaled approximately $183 million. STMicroelectronics will finance the acquisition using existing cash on its balance sheet.
The acquisition has been approved by the Board of Directors of Genesis, which has unanimously recommended that holders of Genesis Microchip's common stock accept the tender offer and approve the second-step merger.
The tender offer, which STMicroelectronics expects to commence no later than December 18, 2007, and the second-step merger, are both subject to customary conditions, including receipt of regulatory approvals, and are
expected to be completed in the first quarter of 2008.
Through this acquisition, STMicroelectronics expects to expand its leadership in the $1.5 billion digital TV market. Genesis Microchip will enhance STMicroelectronics' technological capabilities for the transition to fully digital solutions in this segment and strengthen its product and intellectual- property portfolio.
On closing, Genesis will become part of STMicroelectronics' Home Entertainment & Displays Group. Elias Antoun will join STMicroelectronics and will lead STMicroelectronics' television and display initiatives, reporting to Philippe Lambinet.